1 November 2021
Malaysia is poised to be the regional distribution centre (RDC) and e-commerce logistics hub for the Asia Pacific market, leveraging on the newly established Cainiao Aeropolis eWTP (electronic World Trade Platform) warehouse facility at the Kuala Lumpur International Airport (KLIA).
According to Malaysia Airports Holdings Bhd (MAHB), the Cainiao Aeropolis eWTP Hub would be a game-changer for the country’s e-commerce logistics and Asia Pacific’s preferred air cargo hub due to its strategic location within the free commercial zone with airside access to value-added activities.
Group managing director Datuk Iskandar Mizal Mahmood said the airport operator aims to double up its cargo volume from the current 600,000 tonnes to 1.3 million tonnes by 2030.
“We have about 10 new players from cargo terminal operators, third-party logistics providers and express cargo handlers.
“These will increase the group’s air cargo volume with new value-added services like light manufacturing, assembly, repairs, testing and re-packaging for goods,” he said at the official launching ceremony of the Cainiao Aeropolis eWTP Hub here today.
Iskandar said MAHB aims to gain leadership in e-commerce logistics and establish KLIA as a preferred regional distribution hub within the Asia Pacific.
He said air cargo had shown remarkable resilience in the past two years, which is a silver lining for us in the aviation industry in mitigating the impact of the pandemic.
“Therefore, the establishment of the eWTP Hub is indeed timely, and we believe that it will also serve the aspirations of the 12th Malaysia Plan by enhancing the competitiveness of our transport and logistics sectors through its efficiency, connectivity, and smart supply chain and logistics technology”, he said.
Iskandar said this would further improve air cargo handling processes, increase air cargo volume, and enhance cross-border trade for the nation.
The hub aims to facilitate vertical markets such as retail electronics, automotive, telecommunications, pharmaceuticals and fast-moving fashion.
“We have the scalability to automate our warehouse operations, depending on existing operators to provide technology solutions to expedite the turnaround time while aiming to expand beyond the Southeast Asia market to Oceania and the Middle East,” he said.
The hub, which has been operationalised since November last year, was set up via a partnership between MAHB and Alibaba Group with a total investment of RM500 million, with the establishment of a joint venture company between MAHB (30 per cent) and Alibaba Group (70 per cent).
Iskandar said the hub is also expected to generate a cumulative gross domestic product (GDP) of RM4.2 billion in the next 10 years and support over 35,000 jobs.
Transport Minister Datuk Seri Ir Dr Wee Ka Siong said the government is delighted with the level of commitment and investment shown by MAHB and the Alibaba group in developing the world’s first electronic world trade platform outside of China.
“It symbolises strong ties between Malaysia and China. This collaboration will substantially boost cargo volume for KLIA to double its present volume in the next 10 years and reinforce the country’s cargo and logistics ecosystem spanning air, sea and land connectivity.
“It will benefit the entire logistics value chain comprising cargo airlines, cargo terminal operators, as well as freight forwarders or last-mile delivery service providers,” he said.
Wee said the Malaysian freight and logistics market was valued at US$37.6 billion in 2020 and is expected to reach more than US$55 billion by 2026, with the new economy being a strong contributing factor.
“The advent of e-commerce in recent years has proven to be a boon to air cargo growth as it is the single largest catalytic driver,” he added.
Alibaba Group’s logistics arm Cainiao Network (Cainiao) chief executive officer Wan Lin said the company’s role was to support businesses, especially small-medium enterprises, by providing an efficient and comprehensive global logistics network that can serve a more extensive international customer base and reduce trade barriers.
“Together with our partners, we have created a global network of smart logistics hubs, starting here in Malaysia under the eWTP initiative.
“As a core component within the e-fulfilment ecosystem, the Cainiao Aeropolis eWTP Hub provides crucial logistics support for major events such as the upcoming 11.11 Global Shopping Festival, enabling Malaysian businesses and consumers to benefit from enhanced logistics efficiency and stability,” he said.
Lin said the hub is expected to be a leading logistics and distribution centre in the region. We are honoured to play a part in contributing to Malaysia’s economic development.
Situated on a 24.3ha (2.6 million sq ft) plot of land within KLIA’s vast 10 km X 10 km landbank, the Cainiao Aeropolis eWTP Hub boasts 1.1 million sq ft of warehouse space that houses a host of facilities for cargo terminal operation (CTO), warehousing, sorting, and a dedicated customs clearance that is backed by a first-of-its-kind innovative digital customs clearance system, capable of reducing clearance time from 24-48 hours to 1.5 hours.
This has been made possible by the Royal Malaysian Customs Department through the establishment of satellite operations and an administrative office away from their main base in KLIA, allowing for more rapid cargo clearance while ensuring onsite supervision.
Additionally, the facility enables 24-hour and 72-hour deliveries within Malaysia and the rest of the world, respectively, as part of its efforts to support the country’s economic recovery and increase trade flows in the broader region.